Gap's Margins Narrow Though Operating Expenses Drop

Apparel Retailer Raises Outlook on Asset Sale

Gap Inc. joined a number of other specialty retailers in reporting narrower margins for its second quarter, while lower expenses helped buoy its bottom line.

The San Francisco retailer, which operates its namesake stores as well as the Old Navy and Banana Republic chains, also unveiled plans to enter India through franchise-operated Gap-brand stores next year. The company also plans to increase its store base in the greater China...